Mortgage Rates

Charges Transfer Decrease Once more as Bond Demand Stays Robust

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The bond market is the most important component that lenders use to determine loan rates. The mortgage market is no exception. In fact, mortgages have specific bonds that dictate the prices of loans that are sold between investors in the secondary market. These rates let lenders know where to set their mortgage rates on a particular day.

It has long been believed that the yield on 10-year government bonds also determines mortgage rates. While that’s not entirely the case, longer-term Treasuries (think 5, 7, 10 years) tend to move in relative lockstep with the rates implied by mortgage-backed bonds. So when “things” happen that help longer-term government bonds, mortgages benefit too, even if the timing and extent can vary.

That’s exactly what happened. A planned 10-year Treasury auction showed very solid demand for bonds. Add to this several other events that caused 10-year government bond yields to rise to their lowest level since May 7th (and near their lowest level in nearly 4 months).

The same goes for mortgage rates, but keep in mind that the latitude has been pretty small lately. At best, borrowers will see interest rates one-eighth percent lower from the highs seen at the end of last week (Thursday afternoon or Friday morning, depending on the lender), but most would simply notice the improvement in the form of lower up-front costs or a higher lender.

purchase Loans continue to be rated at the best interest rates. Do you expect courses for a. increase by at least an eighth point refinanced, and even more for cash-out refinancing. All of this requires a self-used main residence. Due to the recent changes at the regulatory level, second homes and investment properties are even further removed from peak prices than they normally are. There’s no reason to expect this trend to end anytime soon.

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